Top 5 Mistakes

Learning Centre - Top Five Mistakes Bidders Make

For most businesses the odds of winning a tender bid are slim. Many bidders focus solely on pricing believing that tenders are only meant to grind out the lowest possible price. What these bidders fail to realize is that while pricing is important, it consistently ranks third behind both quality of goods and services and the bidder’s reputation and ability to deliver on time.

"Poor bidding practices exist with both buyers and sellers," says Dan Pelletier, President of Bid-Winners. "Bid-issuers are often guilty of not clearly explaining their needs and allowing too little time for bidders to respond to complex bids. At the same time, Bidders typically do not spend enough time performing thorough needs-analysis in their haste to rush through yet another proposal."

1. Lack of commitment by management.

• Under estimating the effort required to write a winning bid response.
• Assigning too few or inexperienced resources to the bid team.
• Submitting a poorly written or unprofessional bid proposal.

2. Poor understanding of the buyers needs.

• Failing to ask the buyer pertinent questions to flush out their true buying motives.
• Promoting their own goods and services whether or not they meet the buyer's needs.

3. Understating corporate capabilities and services.

• With the bid response too often focused on pricing, many bidders fail to differentiate themselves or justify why pricing might be higher.
• Still others fail to write their bid response in a manner that gives them maximum points in the evaluation or bid scoring process.

4. Errors in meeting bid compliance.

• It cannot be overstated - You must meet all mandatory requirements or else your bid is disqualified.
• If you cannot meet the mandatory requirements find a partner that can, then enter a joint or alliance bid with you as the Prime.
• If you still cannot meet the mandatory requirements, indicate you will not be bidding because you cannot achieve the specific mandatory requirement. Simultaneously enter a formal request that if none of the bidders meet the mandatory requirements that the bid be re-issued with modified requirements, and that you be allowed to bid at that time.

5. Under estimating the competition’s strengths and strategies.

• Competition is a constantly changing variable in business.
• Bidders must always be aware of what their competitors are doing.
• Keep track of what bids they have won / lost, and what actions they will likely take as a result. Watch out for hungry competitors.
• Competitors often surprise each other by bidding in ways that demonstrate how they strategically want to win and how much they are prepared to lower their price. Strategy in bidding is critical.
• Before submitting your bid you must decide how badly you want to win. Write and price your bid accordingly.

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